Orthocell wins US FDA approval for Remplir product but won’t move production to avoid Trump’s tariffs

The boss of WA biotech Orthocell says there’s no need to shift production to the US to dodge Donald Trump’s tariffs as it wins clearance from the country’s Food and Drug Administration to start selling its flagship nerve repair product. The Perth-based regenerative medicine company emerged from a trading halt on Friday announcing it had received regulatory clearance to start selling Remplir into the US, unlocking the door to a lucrative nerve repair market worth $US1.6 billion ($2.5b). Manufactured at Orthocell’s Murdoch facility, Remplir is a collagen wrap used in the repair of peripheral nerve injuries. It is already approved for sale in Australia, New Zealand and Singapore, and distributed by Device Technologies. Orthocell chief executive Paul Anderson said the excitement around the product and its usage was palpable in the US. “The US is the largest healthcare market in the world, there’s over 700,000 nerve repairs performed in the US per year . . . which makes the US a special market,” he told The West Australian. “We are now laser focused on taking market share and getting this product in more hands of more surgeons, treating more patients in the US than ever before.” The FDA win for Orthocell comes a day after Mr Trump slapped a 10 per cent tariff on all Australian imports. While pharmaceutical — along with oil and gas, semiconductors, gold and copper — was exempt for now, there are fears targeted levies may still be on the horizon. Asked if tariffs would impact Orthocell, Mr Anderson: “We think not”. “We think medical devices are going to be exempt. But even if they’re not, we haven’t started in market yet so we’re not having to adjust our pricing,” he said. “We’ve got a very strong gross margin that enables us to absorb anything of that nature.” Mr Anderson said Australia was given the lowest tariff, with the most severe taxes of up to 49 per cent being slapped on China, Malaysia, Vietnam and Cambodia. The John Van Der Wielen-chaired Orthocell said it expected the US rollout to be an inflection point in its commercialisation path and the catalyst to drive the company towards profitability within a “foreseeable timeframe”. Mr Anderson said it had been preparing in advance for this pivotal milestone, ramping up production from its facility in Perth. He said it had significant levels of inventory in place to deliver on early sales orders. “We expect strong product adoption in the US, having experienced rapid sales traction in existing markets driven by the excellent feedback from surgeons in Australia, New Zealand and Singapore,” he said. Orthocell shares closed down 2 per cent to $1.40 after hitting a high of $1.58 on Friday. It was a rare market winner among a sea of red as the S&P-ASX200 followed the US lower after a tariff-fuelled rout.